Contents

Abstract

The impact of the global financial crisis on the economy of the
Democratic Republic of Congo economy was more severe in 2009 than in
2008. Real gross domestic product (GDP) reached a growth rate of 2.7%,
which is 3.5 percentage points below the rate of growth realised in
2008. With the exception of official aid – which increased from $1019
billion in 2008 to $1499 billion in 2009 – most of the potential
transmission mechanisms were affected. Trade fell from $125 million in
2008 to $-1467 million in 2009; foreign direct investment (FDI) from
$1713 billion to $626 million; and remittances from $212 million to $135
million. Altogether, the impact of the global financial crisis on the
overall balance of payments amounted to $-574 million in 2008 and $-413
million in 2009.

Debt relief allowed the DRC to cover its financial needs before
assistance of $-416 million in 2008 and $-444 million in 2009. In
addition to donor support, more debt relief will be needed to alleviate
the DRC’s financial situation. On 11 December 2009, the International
Monetary Fund (IMF) Executive Board approved a $551 million Poverty
Reduction and Growth Facility (PRGF) arrangement and additional interim
assistance of about $72.68 million under the enhanced Heavily Indebted
Poor Countries (HIPC) Initiative. Thus, the country will be embarking on
a three-year programme to strive to meet the enhanced HIPC Initiative
requirements and triggers and to reach the completion point, giving way
to debt relief under the Multilateral Debt Relief Initiative (MDRI) as
soon as possible.

Signs of recovery from the global financial crisis are manifest,
particularly in the mining sector, through which the DRC’s economy was
hit in the first place. Mining activity is certainly responding
favourably to the new buoyancy in world commodity prices, but there is
an urgent need for an enabling environment, strengthened supervisory
institutions and good governance to attract more private investment in
the sector.

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